Catching up with the West is the big dream of all post-communist countries in Eastern Europe. This dream transpires through imported liberal slogans such as “transition,” “integration” and “market democracy” aired daily on all local TV and radio wavelengths. This rhetorical switch from former socialist command economy to capitalist market economy appears to East European leaders far more palatable than the necessity of removing their own ossified past. In fact, proponents of globalism and their institutional transmission belts, such as the IMF and WTO had never given the green light for the Eastern European masses to forcefully remove communist officials from power. With the choice between local nationalists and local ex-communists, the global plutocrats have opted for the latter. In reality though, the transition to market economy has been going on for years, yielding meager results and only in some areas of Eastern Europe. The countries of Slovenia, the Czech Republic and Hungary now on the fastest track to “catching up with the West,” benefit from their geographic vicinity of affluent Germany. Other post-communist countries further to the East do not have the same comparative geographic advantage, offering little incentive for direct foreign investments.
The modern financial network based in Brussels and New York, makes a mistake, despite its financial ingenuity. These assume that rapid economic growth in Eastern Europe could be solely achieved through liberal formulas or by resorting to some Asian role modeling. What was successful in denazified Germany in the 1950’s, in Thailand and Singapore in the 1980’s, does not apply to present day Rumania, Ukraine, or Croatia. It is also a frequent error among many US politicians to project their own wishful thinking onto Eastern Europe, pumping their taxpayers’ money into the hands of bankrupt East European leaders.
The gap between Eastern and Western Europe is bigger today than ever and likely to get even bigger. In terms of economic output, from a ratio 12 in 1989, the gap in productivity between East and West increased threefold in 1999, notably to the ratios of 13 and 14 respectively. On the whole, east European countries have reached only 60 to 70 per cent of their 1989 communist GDP level. In plain English it means that the purchasing power of the majority of east European citizens is worse off than during the last days of communism.
The leading slogan which had brought down communist economies was the popular outcry, “join Europe.” The main motor behind this naive idea was that Western affluence would suddenly follow suit. But catching up with the West has not occurred. One can now sense a widespread nostalgia for the economic predictability and guaranteed social security which communism once provided for all.
A Western visitor should not be duped by the shopping mall glitz in Croatia’s Zagreb, Hungary’s Budapest, or Russia’s Moscow. Nor should the presence of rowdy young “conspicuous consumers” be viewed as the trademark of an improvement in living standards. The core of any democracy is its middle class. However, in late 1945, the communists physically destroyed the middle class.
An overzealous mimicry by east European leaders copies the free market canons with the incessant regurgitation of slogans such as “the rule of law,” and “market democracy.” But the real market is a mixture of bandit capitalism and shadow economy in full swing. This is true not only for Russia, but also for every other country in the region. The so-called basket-case economies of neo-communist Croatia and the bankrupt post-Milosevic Serbia garner little support from their respective citizenry. This will result in a mass appeal for yet another muscled man in the not too distant future. In such a fragile economic environment that is still governed by never repentant communists now turned phony liberals, it would be unwise for individual US businessmen to make any professional commitments.
Of course, for global sharks it is easy to lecture East European politicians on the virtues of market democracy. Despite their planetary influence modern plutocrats ignore the heritage of communist psychology. All the present political elites from the Baltic to the Balkans are basically recycled communists who have no idea of what a free market really means other than verbal virtuosity in free market recitals.
The road to genuine democracy in Eastern Europe can only be achieved through reeducation and the removal of all former communists from power. Prior to its economic miracle, post-war Germany had to start the process of denazification first – in order to attain the certificate of democracy much later. It is impossible for the present recycled neo-communist political class in Eastern Europe to shed its old Bolshevik carapace. Half a century of communist social leveling, a culture of mendacity and the lack of personal initiative have left deep scars on the souls of all East Europeans. This tragic area of Europe has historically been subject to unpredictable tremors. A new version of bandit capitalism mixed with the legacy of communism creates a breeding ground for all sorts of terrorist temptations. –
Mr Sunic is an author, former professor in political science and contributor from Europe.